RACIAL BELIEFS,LOCATION, AND THE CAUSES OF CRIME*

This article provides a unified explanation for why blacks commit more crime, are located in poorer neighborhoods, and receive lower wages than whites. If everybody believes that blacks are more criminal than whites—even if there is no basis for this—then blacks are offered lower wages and, as a result, locate further away from jobs. Distant residence increases even more the black–white wage gap because of more tiredness and higher commuting costs. Blacks have thus a lower opportunity cost of committing crime and become indeed more criminal than whites. Therefore, beliefs are self‐fulfilling.     

Intertemporal transfers of emission quotas in climate policies

We are interested in situations in which governments are committed to some pollution abatement constraint which does not match the society's most preferred level of pollution, like in the current climate change policies undergone on behalf of the Kyoto protocol. We develop an overlapping generations model with capital and pollution in which the individuals care about the environmental quality. We show that slightly improving the intertemporal flexibility of the emission quotas by authorizing two-period backward and forward transfers allows to decentralize the whole optimal growth path at competitive equilibrium.     

Financial crisis in the Russian Federation: Are the Russians learning to tango?

The paper presents some evidence about the rise and fall of financial markets in Russia in the course of 1998, and discusses the causes and likely consequences of the crisis for the Russian economy. It also discusses some important policy issues regarding the effects of global financial integration. The central message is that the Russian financial disaster is a typical example of crisis contagion, although the underlying vulnerability of the economy was a problem which no investor could ignore. In particular, financial stabilization remained extremely fragile owing to the deterioration of the fiscal situation and the vulnerability of the banking system.     

Does Employee Ownership Benefit Value Creation? The Case of France (2001–2005)

The focus of this paper is employee ownership, specifically the role of employee ownership in value creation. Based on a sample of 163 French companies, we have measured the impact of employee share ownership on value creation for both shareholders and stakeholders. Only companies with a sustained employee ownership policy over a 5-year period (from 2001 to 2005), as defined by the French Federation of Employee and Former Employee Shareholders (FAS), have been considered. The results indicate that employee share ownership plans have no effect on shareholders’ or stakeholders’ value creation.     

Employment and Skills in Financial Services: A Comparison Of Banks and Insurance Companies in Five OECD Countries

Throughout the 1960s and 1970s, financial services remained among the fastest growing sectors in most OECD countries. Since the early 1980s however, the pace of employment growth in financial services has slowed in several countries. In a few of them, such as France, there even have been warnings by industry executives of subsranrial employment losses in the years ahead as result of both market saturation and large productivity increases due to the widespread diffusion of computerised technologies [Le Monde, 1986]. A study recently completed by the authors for the OECD's Centre for Educational Research and Innovation (19871 arrives a conclusions that are at once more optimistic and more complex.     

Bayesian inference for the mover–stayer model in continuous time with an application to labour market transition data

This paper presents Bayesian inference procedures for the continuous time mover–stayer model applied to labour market transition data collected in discrete time. These methods allow us to derive the probability of embeddability of the discrete‐time modelling with the continuous‐time one. A special emphasis is put on two alternative procedures, namely the importance sampling algorithm and a new Gibbs sampling algorithm. Transition intensities, proportions of stayers and functions of these parameters are then estimated with the Gibbs sampling algorithm for individual transition data coming from the French Labour Force Surveys collected over the period 1986–2000. Copyright © 2003 John Wiley & Sons, Ltd.     

Empirical Tests for Stochastic Dominance Efficiency

We derive empirical tests for the stochastic dominance efficiency of a given portfolio with respect to all possible portfolios constructed from a set of assets. The tests can be computed using straightforward linear programming. Bootstrapping techniques and asymptotic distribution theory can approximate the sampling properties of the test results and allow for statistical inference. Our results could provide a stimulus to the further proliferation of stochastic dominance for the problem of portfolio selection and evaluation. Using our tests, the Fama and French market portfolio is significantly inefficient relative to benchmark portfolios formed on market capitalization and book‐to‐market equity ratio.     

Implied volatility surfaces and market activity over time

An impressive body of the literature has investigated the patterns of changes in implied volatilities across strike prices and maturities. Although such studies try to explain the existence of the volatility skew and term structure, they remain silent about the evolution of the volatility surface as time goes by and market variables move. Relying on a technique of signal processing called Independent Component Analysis, we extract volatility modes that account for most of the variations in the shape of the surface. We then relate the magnitude of volatility changes along those modes to market activity.     

Product-based cultural change: Is the village global?

We provide a model of product-based cultural change where trade integration leads to cultural convergence. A standard trade model of Dixit–Stiglitz monopolistic competition is coupled with a micro-founded model of cultural dynamics. We show that access to varieties that are attached to a global cultural type changes the incentives of parents to socialize their children and transmit their type. The resulting increase in agents of the global cultural type leads to a magnification of the initial shock. A striking feature of the model is that even temporary shocks to openness may have permanent effects through the changing distribution of preferences in the economy.